The sale of Olivetti's PC division may be the first step towards the break-up of the whole group, according to Italian unions representing employees at the company.
The unions warned that proposals to sell Olivetti's loss-making PC division would have a wider impact, jeopardising the future of the entire company.
Late last month Centenary, a group which specialises in buying up troubled companies and turning them around, was reported to have signed a letter of intent to buy the PC division although Olivetti refused to comment.
According to reports Centenary, headed by New York investor David Gottesman, is waiting to find an Italian partner to join its rescue operation before it officially completes the deal.
Following those reports, fresh rumours emerged last week that Italian television group Mediaset was planning a bid for the entire Olivetti group, including the PC operation. Mediaset, headed by Ubaldo Livolsi, issued a statement last week saying a deal was still under consideration. The company is keen on entering the telecoms market and would be interested in Olivetti's majority holding in Omnitel.
Despite the turmoil Olivetti's chief executive officer, Roberto Colaninno, issued assurances last week that the company expects to complete work on its turnaround plan by the end of the year.
This is the first time Colaninno has put any timescales on his recovery plans. Previously he had only announced plans to sell several of the company's assets (including the PC division) by the end of the year in an effort to raise 800 billion lire (#311 million).
If Colaninno's promises are to be kept then Olivetti has less than one month to raise 367 billion lire by getting rid of both its 47.9% holding in Tecnost and its PC division.
If Olivetti wants to remain as a group, industry analysts have suggested it will have to make new investment in order to become a company at the crossroads between telecommunications and IT. The trouble is, it hasn't got the cash to do it.
Olivetti: autumn of discontent
Carlo De Benedetti quits Olivetti board.
Francesco Caio is ousted from the company.
Debts doubled in the last two months.
Olivetti announces it's to sell PC division.
Olivetti sells 8% of its stake in Omnitel.
Executive committee is disbanded.
Centenary touted as the buyer for the PC division.
Mediaset may buy whole group except for PC division.
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